Oil prices edged up on Wednesday on signs of short-term supply tightness but remained near a two-week low after OPEC lowered its forecast for global oil demand growth in 2024 and 2025.

Brent crude futures were up 13 cents, or 0.18%, at $72.02 a barrel by 0205 GMT, and U.S. West Texas Intermediate (WTI) crude futures were up 13 cents, or 0.19%, at $68.25.

But weaker demand projections and weakness in top consumer China continued to weigh on market sentiment.

In its monthly report on Tuesday, the Organization of the Petroleum Exporting Countries (OPEC) said global oil demand will rise by 1.82 million barrels per day (bpd) in 2024, down from the 1.93 million bpd growth forecast last month, largely due to weakness in China, the world's biggest oil importer.

Oil prices settled up 0.1% on Tuesday following the news, after falling about 5% over the previous two sessions.

OPEC also cut its estimate for global demand growth in 2025 to 1.54 million bpd from 1.64 million bpd.

However, the market will still feel the impact of any supply disruptions from Iran or further escalation between Iran and Israel, according to Barclays.

Two U.S. central bankers said on Tuesday that interest rates are acting as a brake on inflation that is still above 2%, suggesting the Federal Reserve is open to further rate cuts.

The Fed cut its policy rate last week by a quarter of a percentage point to a range of 4.50%-4.75%. Interest rate cuts typically boost economic activity and energy demand.

Source: Investing.com